Established in 1966, Medicare has had a profound effect on the structure and functioning of the health care system in the United States. Originally conceived to reduce the burden of excessive medical care expenses for the elderly, some have suggested that while Medicare may have stimulated major technological and medical care innovations, it also contributed to the persistent rise in US health care costs. As the incidence of debilitating and costly-to-treat chronic diseases such as diabetes, coronary heart disease, and Chronic Kidney Disease (CKD) continued to rise, clarion calls for a shift in Medicare policy to prevention were made. Although preventive health care had been promoted by Health Maintenance Organizations (HMOs), it was not a clearly stated focus of health policy in the fee for service system until the Medicare Prescription Drugs, Improvement, and Modernization Act (MMA) introduced in 2003. In the current proposal, we seek to understand the causal impact of preventive health care measures introduced as part of the MMA. Two important changes in Medicare effective January 1, 2005 were explicitly preventive in nature: (i) Lipid profile blood screening tests to ascertain the risk of cardiovascular disease, and (ii) Fasting glucose blood tests to screen individuals at "risk" for diabetes. Medicare fully reimbursed providers for the cost of the tests. In addition, no copayments were required. We have the following specific aims: 1. Test the hypothesis that the prevalence of screening tests to measure the levels of fasting glucose increased among those eligible. In the post-program period (after January 1, 2005), several implications follow: a. The prevalence of undiagnosed diabetes decreased. b. Hospitalization rates due to diabetes, and CKD decreased. 2. Test the hypothesis that the prevalence of screening tests to measure lipid profiles increased among those eligible for the cardiovascular screen. Additional testable implications for the eligible are: a. Hospitalization rates due to cardiovascular disease decreased. b. Mortality rates due to cardiovascular disease decreased. 3. (a) Screening take-up rates were higher for those with lower income. (b) The effects of screening tests on both utilization, and health were greater for the more educated. Since we perfectly observe the selection rules that drive eligibility into the screening program, we can implement a quasi-experimental research design to estimate the causal effects of MMA's preventive health care measures on costs, utilization, and health outcomes. We anticipate that the findings arising from this project will help us anticipate the effects of key preventive health care measures put in place by the Affordable Care Act (ACA). PUBLIC HEALTH RELEVANCE: In this project, we estimate the effects of Medicare providing free preventive screening for diabetes and cardiovascular disease on health care costs, utilization, and health outcomes. The findings of our research should significantly improve our understanding of the effect of health insurance coverage for preventive care services that are mandated by the Affordable Care Act (ACA).